Delaware Statutory Trust (DST) 1031 Exchange Calculator
Delaware Statutory Trusts (DSTs) are passive 1031 exchange replacement properties — fractional ownership of institutional-grade commercial real estate. They solve the 'find a replacement in 45 days' deadline pressure that derails most direct exchanges.
Why Investors Use DSTs
The 1031 exchange has tight deadlines: 45 days to identify replacements, 180 days to close. DSTs solve this by providing pre-packaged institutional properties that close in days. They are particularly useful for retirees moving from active to passive real estate.
DST Costs Versus Direct Ownership
Sponsor load (6-9% upfront) reduces effective invested equity. Annual asset management fees of 50-150 bps. Most DSTs have a 5-10 year sponsor-controlled hold period — you cannot exit early. The trade-off is zero management burden and access to deals you could not buy directly.
Tax Treatment Match To 1031
DSTs are explicitly approved by IRS Revenue Ruling 2004-86 as 1031-eligible replacement property. The interest is treated as direct real estate ownership for tax purposes — depreciation passes through, sale of the DST share triggers gain unless reinvested in another exchange.
Source: IRS Revenue Ruling 2004-86; FINRA DST sponsor disclosures. Last updated: May 2026.